"The bonds were purchased by a wide spectrum of investors ranging from
individuals in the retail market, to banks, investment funds, pension funds,
insurance companies and other corporates. The strong market response prompted
the joint issue managers and joint lead underwriters to exercise the company’s
oversubscription option,” the Sy-led SM Investments said in a statement
yesterday.

SM Investments had offered from June
27 to July 6 Series C seven-year bonds with a 6% per annum interest rate. It
also offered Series D 10-year bonds with a 6.9442% interest rate per annum, in
minimum denominations of P20,000 each and in multiples of P10,000.00
thereafter, according to the bonds’ earlier listing prospectus.

The bonds, which have an issue date of
July 16, were recently top-rated by Philippine Rating Services Corp., earning
the local debt watcher’s outstanding PRS Aaa rating.

With the overallotment option of P5
billion being exercised, SM Investments expects to bag P14.883 billion in net
proceeds.

A bulk of the proceeds will go to land
banking initiatives, while the balance will go to the construction of the
204-room Park Inn Davao by Radisson -- set to open in the third quarter next
year -- and planned hotel projects in Metro Manila; Santelmo, Batangas; and
Clark, Pampanga, earlier reports showed.

In addition, part of the proceeds will
also be allocated for the construction of various office buildings under unit
SM Land, Inc.

measuring approximately 230,000 square
meters in total gross floor area.

Last April, SM Investments moved to
issue P10 billion worth of fixed-rate peso retail bonds, to be offered in 10-
and 15-year tranches, while in February, the company announced the distribution
of five-year convertible bonds with a coupon rate of 1.625%.

The firm has allotted a record P56.80
billion capital budget for this year -- a 20% increase from the year previous
-- to fund expansions of mall and condominium development units.

For the first quarter, SM Investments
realized a net income of P6.04 billion, up 12.48% from P5.37 billion a year
ago.

Revenues rose by 16.16% to P49.68
billion from P42.77 billion last year.

Shares of SM Investments slid by 1.14%
to P736.50 apiece from P745.00 at its previous close. -- Franz Jonathan G. de
la Fuente